diff --git a/src/index.js b/src/index.js
index 78e59d76..b120c988 100644
--- a/src/index.js
+++ b/src/index.js
@@ -567,7 +567,12 @@ function createConfig(options, entry, format, writeMeta) {
 									sourceMap: options.sourcemap,
 									declaration: true,
 									jsx: 'react',
-									jsxFactory: options.jsx || 'h',
+									jsxFactory:
+										// TypeScript fails to resolve Fragments when jsxFactory
+										// is set, even when it's the same as the default value.
+										options.jsx === 'React.createElement'
+											? undefined
+											: options.jsx || 'h',
 								},
 							},
 							tsconfig: options.tsconfig,
diff --git a/test/__snapshots__/index.test.js.snap b/test/__snapshots__/index.test.js.snap
index e40bcff8..1230cb56 100644
--- a/test/__snapshots__/index.test.js.snap
+++ b/test/__snapshots__/index.test.js.snap
@@ -2332,6 +2332,61 @@ exports[`fixtures build shebang with microbundle 5`] = `
 "
 `;
 
+exports[`fixtures build ts-jsx with microbundle 1`] = `
+"Used script: microbundle build --jsx 'React.createElement'
+
+Directory tree:
+
+ts-jsx
+  dist
+    index.d.ts
+    ts-jsx.esm.js
+    ts-jsx.esm.js.map
+    ts-jsx.js
+    ts-jsx.js.map
+    ts-jsx.umd.js
+    ts-jsx.umd.js.map
+  node_modules
+  package.json
+  src
+    index.tsx
+  tsconfig.json
+
+
+Build \\"tsJsx\\" to dist:
+130 B: ts-jsx.js.gz
+94 B: ts-jsx.js.br
+131 B: ts-jsx.esm.js.gz
+111 B: ts-jsx.esm.js.br
+220 B: ts-jsx.umd.js.gz
+177 B: ts-jsx.umd.js.br"
+`;
+
+exports[`fixtures build ts-jsx with microbundle 2`] = `7`;
+
+exports[`fixtures build ts-jsx with microbundle 3`] = `
+"export declare const foo: any;
+"
+`;
+
+exports[`fixtures build ts-jsx with microbundle 4`] = `
+"var n=function(n,r){return{tag:n,props:r,children:[].slice.call(arguments,2)}}(function(n){return n.children},null,\\"foo\\");export{n as foo};
+//# sourceMappingURL=ts-jsx.esm.js.map
+"
+`;
+
+exports[`fixtures build ts-jsx with microbundle 5`] = `
+"var n=function(n,r){return{tag:n,props:r,children:[].slice.call(arguments,2)}}(function(n){return n.children},null,\\"foo\\");exports.foo=n;
+//# sourceMappingURL=ts-jsx.js.map
+"
+`;
+
+exports[`fixtures build ts-jsx with microbundle 6`] = `
+"!function(e,n){\\"object\\"==typeof exports&&\\"undefined\\"!=typeof module?n(exports):\\"function\\"==typeof define&&define.amd?define([\\"exports\\"],n):n((e=e||self).tsJsx={})}(this,function(e){var n=function(e,n){return{tag:e,props:n,children:[].slice.call(arguments,2)}}(function(e){return e.children},null,\\"foo\\");e.foo=n});
+//# sourceMappingURL=ts-jsx.umd.js.map
+"
+`;
+
 exports[`fixtures build ts-mixed-exports with microbundle 1`] = `
 "Used script: microbundle
 
diff --git a/test/fixtures/ts-jsx/package.json b/test/fixtures/ts-jsx/package.json
new file mode 100644
index 00000000..924d9fe1
--- /dev/null
+++ b/test/fixtures/ts-jsx/package.json
@@ -0,0 +1,7 @@
+{
+	"name": "ts-jsx",
+	"source": "src/index.tsx",
+	"scripts": {
+		"build": "microbundle build --jsx 'React.createElement'"
+	}
+}
diff --git a/test/fixtures/ts-jsx/src/index.tsx b/test/fixtures/ts-jsx/src/index.tsx
new file mode 100644
index 00000000..1b9dc700
--- /dev/null
+++ b/test/fixtures/ts-jsx/src/index.tsx
@@ -0,0 +1,10 @@
+const createElement = (tag, props, ...children) => ({ tag, props, children });
+// eslint-disable-next-line no-unused-vars
+const Fragment = ({ children }) => children;
+
+const React = {
+	createElement,
+	Fragment,
+};
+
+export const foo = <>foo</>;
diff --git a/test/fixtures/ts-jsx/tsconfig.json b/test/fixtures/ts-jsx/tsconfig.json
new file mode 100644
index 00000000..82f99666
--- /dev/null
+++ b/test/fixtures/ts-jsx/tsconfig.json
@@ -0,0 +1,5 @@
+{
+	"compilerOptions": {
+		"jsx": "react"
+	}
+}